Well Ravi! Procedure for transfer of government securities within NSDL is exactly similar to that of transfer of equity shares.
Settlement of RBI Trades
Procedure for purchase or sale of government securities when the counter party has government security balances in book entry form with any other SGL entity, the following steps have to be followed.
Purchase by Depository Client:- In case of purchase of government securities by a depository client from a seller holding securities in an SGL account with other eligible entity, the buying client should submit Inter-SGL Trade Purchase Instructions in the prescribed format to the DP. The client should also make necessary funds available to the NSDL for the purchase of these securities. The DP, on the basis of the purchase instruction form, should execute a dematerialisation instruction for the quantity of security purchased, at least one day prior to the day of trade settlement at RBI. The DP should also forward the purchase instruction form to NSDL. On the basis of the documents received from the DP, NSDL will execute Form (iii) and submit it to RBI for settlement. On settlement day, the RBI will credit the SGL-2 account of NSDL and debit its current account for funds. On receiving information about crediting of securities from RBI, NSDL confirms the receipt of securities to the client.
Sale by Depository Client:- In case of sale of government securities by a depository client to a buyer who maintains an SGL account with other eligible entity, the selling client should submit Inter-SGL Trade Sale Instruction in the prescribed format to the DP. The DP, on the basis of the sale instruction form, executes a rematerialisation instruction for the quantity of security sold, at least one day prior to the day of trade settlement at RBI. The DP also forwards the sale instruction form to the NSDL. On the basis of the documents received from the DP, the NSDL executes Form (iii) and submits it to RBI for settlement. On settlement day, the RBI debits the SGL-2 account of the NSDL and credits its current account for purchase consideration. NSDL credits the current account of the DP with the sale consideration and intimates the DP accordingly. The DP, on receiving the intimation, credits the amount to the account of the client.
Corporate Benefits with respect to Government Securities The NSDL informs all the DPs about the shut-period (book closure) for government securities as and when announced by RBI. On receiving such information from the NSDL, DP must ensure that changes in the beneficial owner's accounts, such as change in bank details, change of address, etc., are updated well in advance of the due date of interest payment and/or redemption payment due date.
NSDL should distribute the interest to clients who have balances in government securities, on which interest payment is due, at the EOD of the interest payment due date, after RBI has been made it available to the NSDL.
NSDL pays the redemption amount to clients who have balances in government securities, due for redemption, at the EOD of the redemption due date, after the redemption amount has been made available to NSDL by RBI. NSDL makes the payment directly to the clients or to the bank account of the clients as per the details given in the account opening form.
Information collected from www.nseindia.com
Answered by
Kumaar
, an ibibo Master,
at
5:41 PM on October 27, 2008
